First, rare earths have skyrocketed in importance due to their ubiquity in core technologies such as data centres, mobile phones, electric vehicles, robots and chips equipment. They also carry significant geopolitical weight. China, which holds a near-monopoly on rare earth refining and processing, has used this as leverage in tariff talks with the US.

Second, Malaysia's discovery of 16.2 million metric tonnes of rare earth deposits, worth an estimated US$175 billion, puts the country among the top five globally in terms of reserves. Access to Chinese technology for the complex and multi-stage separation process for rare earths, often involving 100 steps guarded by trade secrets, would be equivalent to having the master key to the vault.

Third, China's dominance in rare earths is likely insurmountable in the medium term due to its technological depth and efficiency lead. Not only did China start early since the 1950s, with the state doubling down under Deng Xiaoping ("The Middle East has oil, China has rare earths") and Jiang Zemin's clarion calls, it has continued this dominance by building an entire supply chain within China.

Today, Chinese rare earth capabilities and talents are truly second to none. The US had the Mountain Pass mine but lost its processing technology and talent. Between 1950 and 2020, China filed 25,000 rare earth patents while the US filed less than half that. At the moment, China mines about 60 per cent of the world's rare earths.

If its cooperation with China materialises, Malaysia might create a two-track rare earth ecosystem - one with Chinese technology and another with Australian firm Lynas, which has a rare earths processing plant in Pahang. Lynas is currently the world's only commercial producer of heavy rare earths outside of China.

This means that in the coming years, Malaysia could become a battleground in the global race for rare earths, courted by great powers, but beholden to none.